A+W books sales growth despite Prairie ‘challenges’

Ingredient marketing seen having 'powerful impact'

Canadian burger and root beer chain A+W has chalked up another year of same-store sales growth despite “economic challenges” in the Alberta and Saskatchewan markets.

Posting its year-end results on Tuesday, A+W’s Vancouver-based income fund reported same-store sales growth of 3.4 per cent in 2016 over 2015, down from a 7.6 per cent sales growth rate in 2015 over 2014.

The year-over-year growth comes “despite a challenging year for the foodservice industry in Canada and the severe downturn in Alberta’s economy due to the plunge in oil prices,” the company said in a release.

“We continue to see economic challenges in the important Alberta and Saskatchewan markets that impact our overall results,” A+W Food Services CEO Paul Hollands said in the release.

“However, our strategic commitment to better ingredients is having a powerful impact and has been successful at growing market share in the quick service restaurant burger market.”

The company in recent years has revamped its ingredient sourcing and promoted its menu items accordingly, among them beef raised without the use of hormones or steroids, eggs from hens fed a diet without animal byproducts, chicken raised without the use of antibiotics and bacon from hogs raised without the use of antibiotics.

The fund reported royalty income of $34.135 million for 2016, up 7.3 per cent, on sales of $1.138 billion, up from $1.061 billion in 2015. Net income and comprehensive income totalled $23.92 million for 2016, up from $21.32 million.

The chain also continued on an aggressive expansion track, opening 31 new restaurants across Canada during 2016, for a net increase of 24, bringing its Canadian royalty pool to 838 stores at year-end.

The company also announced late last month it would add an all-day breakfast menu starting Feb. 27, including its Bacon + Egger, Sausage + Egger and Cheese + Egger breakfast sandwiches and its Breakfast Wrap. — AGCanada.com Network